Former Kenya Orchards Chief Executive Officer, Sudhir Damodar Vaidya. [Photo/Daily nation ]
The Kenya fruit processing plant, Orchard is in trouble for breaching the Capital Market Authority ( CMA) guidelines after it failed to immediately inform the regulator of appointment of new chief executive.
Kenya Orchards had on July 31 appointed Mr. Vipul Patel, who has a 14.89 percent share of the company, to take over from Sudhir Damodar Vaidya as the chief executive officer (CEO) but failed to notify CMA of the new appointment within 24 hours as stipulated by the regulator's guidelines.
According to CMA, the fruits firm informed them of new appointments three weeks later prompting them to launch an investigation into the failure to disclose the change within the legally stipulated window.
During an interview with Business Daily, the CMA said that the investigations “established a breach” of the continuous reporting regulations which require listed companies to make public the hiring of a new CEO and also publish the notice in the newspapers which not done by the firm.
Kenya Orchards had however been given time to respond to the findings before CMA takes necessary actions against the company considering that it is given powers by the capital markets act which include heavy financial penalties for up to Sh10 million for contravening its regulations.
In a statement, Kenya Orchards acknowledged breaching of rules and asked for leniency arguing out that the appointment was not intentional.